New CLSA Standard Contract 2022 - Liability

[aidensanchez0812]

Hi guys,

Question for ya'll,

The new CLSA Contract 2022 states this in paragraph 25:

25.Liability Limits. Client agrees that Consultant's total liability to Client, its agents, employees, contractors, subcontractors, successor sand assigns, for professional negligence, acts, errors or omissions of Consultant, shall be limited to $______ or Consultant's fees, which ever is greater.

My question is: what is everyone putting down for the limits in paragraph 25? The previous CLSA Contract from 2009 in the same paragraph with the same language had an amount set at $50k. Does anyone know what that number was based on?

Furthermore, there is another paragraph in the 2022 contract that states this:

44.Professional Liability Insurance.
Consultant carries Professional Liability Insurance (Errors and Omissions Coverage) in the amount of $____________ to be in effect throughout the contract term. Certificate of Insurance will be furnished to Client upon request.
Consultant does not carry Professional Liability Insurance (Errors and Omissions Coverage)

In paragraph 44 we are putting our Professional Liability Insurance coverage limits, but we are not sure that paragraph 25 should have the same amount.

Let me know what y'all think.


Thanks!

[Jim Frame]

Let me know what y'all think.

I think that anyone who would sign that contract is a fool. The duty to defend (see Section 23, the Hold Harmless clause) is a blank check.

For my small-time clients (individuals and commercial entities that don't have their own standard forms) I use a simple letter contract, usually one page that's devoid of legalese except for the mandatory BPELSG language at the end. No problems in 30+ years.

Most of my larger clients, especially public agencies and corporations, want to use their own contracts. I almost always have to negotiate the indemnity language. On the advice of my insurance carrier's counsel, I substitute the following for the (usually grossly unfair) original language:

Consultant shall, to the fullest extent permitted by law, indemnify and hold harmless the [CLIENT], its officers, agents, employees and volunteers (referred to hereinafter as "[CLIENT]") against all third-party tort liability for bodily injury and property damage, including reasonable attorneys' fees and litigation costs, to the extent caused by the Consultant's negligent performance of professional services, as determined by judicial or arbitration proceedings, excepting only those claims, damages, liabilities or costs caused by the negligent acts or negligent failure to act by [CLIENT]. Neither the Consultant nor [CLIENT] shall be obligated to defend or indemnify the other party in any manner whatsoever for the other party's own concurrent or sole negligence or alleged concurrent or sole negligence. Nothing herein is intended to create a duty to immediately defend the other party until and unless negligence is established by judicial proceedings or arbitration on the part of the party charged with a defense tender hereunder.

Only once have I had a prospective client refuse to budge on the indemnity language. It would have been a nice job ($50k or so worth of boundary work, as I recall), but their contract was so thoroughly tilted against the surveyor that there was no way I was going to sign it. After several rounds of requests to change the indemnity language they finally said that they'd found a surveyor who would sign it as is. I wished them luck with the project and moved on.

[Robert Martin]

...For my small-time clients (individuals and commercial entities that don't have their own standard forms) I use a simple letter contract, usually one page that's devoid of legalese except for the mandatory BPELSG language at the end. No problems in 30+ years...

Jim, I would appreciate seeing an example of your one page contract... Could you PM or email me? I have tried several times to get a contract on a single page, but just including the (5) NOW (6) items required per section 8759 of the PLS Act I can't seem to fit everything on a single page.
Thanks,

[Jim Frame]

I would appreciate seeing an example of your one page contract

The attached PDF is an anonymized copy of a recent 1-page contract.

t.pdf

P.S. I just now became aware of the addition of 8759(6)(a) to the PLS Act, so I'll have to tweak my standard language a bit to accommodate it. It doesn't matter for the example contract, as my client is a licensed engineer.